Teachers’ pension revision stalls, but Iran is still on the table

[private]A proposal to phase out the current pension system for retired public school teachers and replace it with an investment savings account, SB 152, will not move out of the Senate Retirement Committee.

The bill, which was strongly opposed by educators’ organizations, was on the agenda for a joint meeting Thursday of the Senate and House Retirement Committees. Senators voted against sending the bill to the state auditor’s office for an actuarial analysis, which effectively killed the measure.

“It was never going to pass anyway,” Rep. Paul Battles (R-Cartersville), chairman of the House Retirement Committee, remarked after the meeting.

Sens. Hunter Hill (R-Atlanta) and Fran Millar (R-Dunwoody) sponsored SB 152, which would end the current system that pays teachers who retire after 30 years service pensions equal to 60 percent of their pay.

The bill would have left current retired teachers alone but would have applied to teachers hired after Jan. 1, 2017.

“I think a retirement system should incentivize excellent teaching today, incentivizing results for our children in the classroom regardless of how long the teacher’s been teaching,” Hill said. But his senate colleagues did not move the bill forward.

A pension bill that did move forward was SB 246 by Sen. Judson Hill (R-Marietta), which would prohibit the state’s various retirement systems from investing in companies that do business with countries identified by the federal government as state sponsors of terrorism, such as Iran and North Korea.

The two biggest pension funds, the Teachers Retirement System (TRS) and the Employees’ Retirement System (ERS), have combined assets of more than $83 billion.

“Terror-free investing does work,” Judson Hill said. “There is evidence that terror-free investing does not impede investment performance.”

The retirement systems, however, have a fiduciary responsibility to “maximize the return (on investments) to be able to pay the (retirement) benefits,” according to Jeff Ezell, the TRS executive director.

“It reduces the pool of companies we can invest in,” Ezell said. “Very good companies like General Electric, we would not be able to invest in. Volkswagen is another.”

“We want to have as broad an array of investment opportunities as possible,” said ERS Executive Director James Potvin.

Other retirement bills in the two committees:

SB 149 and SB 150 by Sen. Josh McKoon (R-Columbus) would provide creditable retirement service for earlier military service.

HB 635 by Rep. Bubber Epps (R-Dry Branch) increases the years of mandatory contributions to the Judges of the Probate Courts Retirement Fund.

HB 687 by Rep. Trey Kelley (R-Cedartown) would allow judges to transfer their funds from the ERS to the Georgia Judicial Retirement System.

HB 690 by Rep. Amy Carter (R-Valdosta) would allow law enforcement officers to get up to five more years of creditable service in the ERS.

HB 508 by Rep. Barry Fleming (R-Harlem) lowers from 65 to 60 the age at which appellate court judges can start drawing retirement benefits.

HB 590 and HB 591 by Rep. Bill Hitchens (R-Rincon) revise provisions of the Peace Officers’ Annuity and Benefit Fund.

HB 421 by Rep. Chad Nimmer (R-Blackshear) makes officers of the Department of Community Supervision eligible for disability benefits.

© 2015 by The Georgia Report

 

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Tags: ERS , Judson Hill , Paul Battles , state pension systems , teacher pensions , TRS